Total backlog increased significantly to $22.16 billion as of March 28, 2025, up from $18.47 billion in the prior year. This growth was predominantly driven by strong performance in the I&AF segment across Water, Life Sciences, Transportation, and Cities & Place markets, and organic growth in PA Consulting.

The company completed the Reverse Morris Trust transaction on September 27, 2024, spinning off its Critical Mission Solutions (CMS) and portions of Divergent Solutions (DVS) businesses. This strategic shift positions Jacobs as a more focused science-based consulting and advisory solutions provider.

In February 2025, Jacobs announced its 'Challenge Accepted' strategy, aiming to accelerate its transformation and drive profitable growth. The strategy emphasizes delivering scalable end-to-end solutions globally and digitally across water and environmental, life sciences, advanced manufacturing, and critical infrastructure.

The company incurred $25.4 million in restructuring and other charges for the six months ended March 28, 2025, related to the Separation Transaction and PA Consulting initiatives. These actions are expected to yield estimated gross annualized pre-tax cash savings of $120 million to $147 million from the Separation and $50 million to $65 million from PA Consulting.

PA Consulting's operating profit increased by 17.0% for the six months ended March 28, 2025, driven by improved revenues and favorable impacts from reduced costs. This indicates successful execution of plans to improve business processes and cost structures within the segment.

Management successfully executed an Equity-for-Debt Transaction, extinguishing $311.5 million of the 2021 Term Loan Facility debt by exchanging Amentum shares. Additionally, new 2025 Term Loan Facilities were secured to repay remaining 2021 Term Loan debt, demonstrating proactive capital structure management.

The company continues to monitor increased geopolitical uncertainty and risks, including policy risks, potential civil unrest, and ongoing conflicts like Russia-Ukraine and Israel-Hamas. These factors could adversely impact future financial performance and operations, as highlighted in the forward-looking statements.

Risks related to general economic conditions, including inflation, changes in interest rates, and foreign currency exchange rates, continue to be a concern. These factors can impact project demand, funding availability, and the company's cost structure, as noted in the MD&A.

I&AF operating profit for the three months ended March 28, 2025, was impacted by a reserve in connection with an unfavorable interim ruling against a consolidated joint venture. This specific event highlights the inherent risks in complex project structures and joint ventures.

The significant increase in total backlog to $22.16 billion (from $18.47 billion YoY) indicates strong demand for Jacobs' services across its target markets. This suggests the company is effectively competing and securing new business despite market challenges.

Jacobs' transformation into a science-based consulting and advisory solutions provider, reinforced by its 65% stake in PA Consulting, strengthens its position in high-value, digitally-enabled solutions. This specialized focus aims to differentiate the company in complex sustainability and critical infrastructure challenges.

Selling, general and administrative (SG&A) expenses for the three months ended March 28, 2025, were $529.7 million, a slight increase of $1.0 million YoY, but as a percentage of revenue, they decreased. This indicates effective cost management relative to top-line expansion, partly due to lower restructuring costs.

Total net periodic pension benefit expense decreased to $1.18 million for the three months ended March 28, 2025, down from $2.04 million in the prior year. This reduction contributes positively to overall operational efficiency.

The balance of accruals for restructuring and other charges decreased to $9.1 million at March 28, 2025, from $44.9 million at September 27, 2024. This indicates progress in completing restructuring initiatives and realizing associated cost savings.

Jacobs is harnessing its data and digital capabilities, products, and tools to help clients operate more efficiently. The company invests in cutting-edge digital, data, and AI solutions to empower client decision-making across the asset lifecycle, including cybersecurity domains.

PA Consulting, in which Jacobs holds a 65% stake, accelerates new growth ideas from concept to commercial success and revitalizes organizations. Their work spans applying data and analytics to improve various sectors, including healthcare and transport, demonstrating a commitment to technological advancement.

The company repurchased $552.4 million in common stock during the six months ended March 28, 2025, significantly higher than $195.5 million in the prior year. A new $1.5 billion share repurchase authorization was approved in January 2025, signaling management's confidence in the company's valuation.

Long-term debt increased by approximately $1.3 billion to $2.63 billion at March 28, 2025, from $1.35 billion at September 27, 2024. This increase was primarily driven by new borrowings under the 2025 Term Loan Facility and an increased draw on the revolving credit facility to fund share buybacks, dividends, and taxes.

The Board of Directors declared a quarterly dividend of $0.32 per share on April 30, 2025, an increase from the previous $0.29 per share. This reflects a commitment to returning capital to shareholders, consistent with the company's capital allocation strategy.

The Revolving Credit Agreement incorporates a modest sustainability-linked pricing adjustment, which resulted in a favorable interest rate adjustment for the company in February 2025. This demonstrates an integration of ESG metrics into financial instruments.

Jacobs is supporting the U.K. Department for Energy Security & Net Zero's Carbon Capture, Usage and Storage program, an essential element of the U.K.'s commitment to deliver a net-zero economy by 2050. This highlights the company's involvement in significant environmental initiatives.

The company's 'Challenge Accepted' strategy is driven by its purpose to create a more connected, sustainable world. This overarching strategic direction indicates a commitment to social and environmental responsibility beyond specific projects.

Approximately $1.16 billion of the company's weighted average borrowings are subject to floating rate exposure. A hypothetical 1.00% increase in floating interest rates would result in an approximate $5.8 million increase in interest expense for the six months ended March 28, 2025.

The company is exposed to foreign currency risk, with $815.8 million in notional value of exchange rate sensitive instruments at March 28, 2025. Foreign currency translation had an unfavorable impact of $18.8 million on revenues for the three months ended March 28, 2025.

Jacobs' strategy aligns with evolving client needs in areas like urbanization, infrastructure modernization, digital evolution, and environmental resilience. This positioning allows the company to capitalize on significant industry trends and drivers, as stated in the business overview.